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As crude oil prices tried to bounce back from a five-year low, oil companies and OPEC try to adjust to low oil prices. BP earnings kicked off the big oil earnings season and they could have been worse.

Data showed that the U.S. economy contracted by 1% during the first quarter of the year. Consumer spending declined in April, the first decline in a year even though disposable income rose. The overall economic picture remains bleak.

When U.S. financial markets finished their temper tantrum over the Federal Reserve acknowledging that QE3 would have to end, the prospects of more rational market fundamentals emerged. But as we enter 2014, markets appear stuck on taper.

The Brent vs. West Texas Intermediate oil spread came in to the lowest level in three years. The reason is clear. Based on global economic data most of the demand for oil is going to be in the United States as compared to a weak Asia and Europe.

If the International Energy Agency tells you that the market is well supplied, you had better believe it. The agency that represents 28 consuming countries always wants to error on the side having too much oil as opposed to not enough.